Public Management

Climate Action Could Boost Global GDP by 0.2% by 2040, Report Says

Climate Action Could Boost Global GDP by 0.2% by 2040, Report Says
Wednesday, 26 March 2025 13:22

The battle against climate change is not just about preventing catastrophic impacts on ecosystems and human life; it also presents a significant opportunity for medium- and long-term economic growth. This is the finding of a new report by the OECD and UNDP. They believe that stronger efforts to tackle climate change could add 0.2% to global GDP by 2040, which is roughly equivalent to the GDP of Sweden.

The report, titled Investing in Climate for Growth and Development - The Case for Enhanced NDCs, was released following the 16th Petersberg Climate Dialog in Berlin, which took place from March 25 to 26. The event, attended by delegates from 40 countries, is seen as a key step toward preparing for COP30, the upcoming global climate summit in Belem, Brazil, in November.

Nearly a decade after the landmark COP21 in Paris, the report highlights that countries are still struggling to meet their climate commitments. Specifically, the authors point out that many nations have yet to present their Nationally Determined Contributions (NDCs) — the pledges to help limit global warming to 1.5°C. While these NDCs were supposed to be submitted by February 10, only 13 out of 175 countries have met the deadline.

Despite these setbacks, the report argues that nations would benefit from maintaining high climate ambitions and accelerating action. Projections show that if countries renew their commitments in line with the Paris Agreement goals, they could reduce climate-related risks, avoid costly damages, and boost the global GDP by 3% by 2050, and by 13% by 2100.

1Image 2

Beyond the economic benefits, the authors also stress that such efforts would be a significant step toward a low-carbon economy. Currently, the world emits 0.34 kg of CO₂ per dollar of economic output. However, under an optimistic scenario, this carbon intensity could drop by more than half, to just 0.14 kg by 2040.

"Investing in clean energy and energy efficiency increases productivity and innovation, balancing the economic impact of policy constraints on prices and consumption," the report explains. "Reinvesting carbon revenues can further boost GDP while ensuring a just transition and securing public support for climate policies".

On the other hand, the authors warn that political uncertainty can hinder investment and slow growth. Unclear policies could delay private sector investments and reduce global GDP by 0.75% by 2030.

This report comes at a time when global climate engagement appears to be slipping, particularly with the second withdrawal of the U.S. from the Paris Agreement. As the world’s second-largest emitter of CO₂, behind China, the U.S. accounts for nearly 15% of global emissions. The question now is whether this report will reignite international commitment to tackling climate change in the coming months.

On the same topic
• Burkina Faso-based financial group, Vista Group Holding, has acquired a majority stake in Société Générale Burkina Faso (SGBF).•The move is part of...
• Gabon signs two major financing agreements with Afreximbank totaling over $3.2 billion.• Projects target mining sector transformation, expanded...
• Afreximbank to mobilize up to $1.5 billion for Chad’s private sector development.• Agreement supports key sectors, including agropastoral...
(WAVE) - Wave Mobile Money, Africa’s fastest-growing mobile money platform, has raised EUR 117 million in debt financing to advance its mission of...
Most Read
01

• Maritime sector faces renewed risks amid military tensions in the Middle East• Blockade fears at S...

Israel-Iran conflict raises new threats for global shipping and oil trade
02

Lebara Group is now bringing its affordable and reliable mobile services to Africa, starting with Ni...

Telecoms: Lebara Enters Nigerian Market with Strong Competitive Ambitions
03

• Google unveils Veo 3, its latest AI tool for ultra-realistic video generation• Experts warn deepfa...

Deepfake Threat Becomes Alarming in Africa as AI Advances Faster Than Laws
04

In a West African financial landscape marked by tighter regulation of the fintech sector, digital fi...

In Five Years, Francophone Africa Will be A Major Force in African Tech –Régis Bamba
05

• Gates Foundation commits $1.6 billion over five years to Gavi.• Bill Gates warns of rising ch...

Gates Foundation Pledges $1.6 Billion to Gavi to Boost Global Child Vaccination
Enter your email to receive our newsletter

Ecofin Agency provides daily coverage of nine key African economic sectors: public management, finance, telecoms, agribusiness, mining, energy, transport, communication, and education.
It also designs and manages specialized media, both online and print, for African institutions and publishers.

SALES & ADVERTISING

Benjamin FLAUX
bf@agenceecofin.com 
Téls: +41 22 301 96 11 
Mob: +41 78 699 13 72
Média kit : Download

EDITORIAL
redaction@agenceecofin.com

More information
Team
Publisher

ECOFIN AGENCY

Mediamania Sarl
Rue du Léman, 6
1201 Geneva
Switzerland

 

Ecofin Agency is a sector-focused economic news agency, founded in December 2010. Its web platform was launched in June 2011. ©Mediamania.

 
 

Please publish modules in offcanvas position.